Euro area monthly balance of payments: February 2019

In February 2019 the current account of the euro area recorded a surplus of €27 billion, compared with a surplus of €37 billion in January 2019.[1]

In the 12-month period to February 2019, the current account recorded a surplus of €335 billion (2.9% of euro area GDP), compared with a surplus of €374 billion (3.3% of euro area GDP) in the 12 months to February 2018.

In the financial account, euro area residents made net acquisitions of foreign portfolio investment securities totalling €59 billion in the 12-month period to February 2019 (decreasing from €692 billion in the 12 months to February 2018). Non-residents made net sales of euro area portfolio investment securities totalling €66 billion (following net purchases of €348 billion in the 12 months to February 2018).

The current account of the euro area recorded a surplus of €27 billion in February 2019, decreasing by €10 billion compared with January 2019 (see Chart 1 and Table 1). Surpluses were recorded for goods (€26 billion), services (€6 billion) and primary income (€7 billion). These were partly offset by a deficit for secondary income (€13 billion).

In the 12 months to February 2019, the current account recorded a surplus of €335 billion (2.9% of euro area GDP), compared with one of €374 billion (3.3% of euro area GDP) in the 12 months to February 2018. This decline was driven mainly by smaller surpluses for goods (down from €324 billion to €278 billion) and services (down from €110 billion to €102 billion), and by a larger deficit for secondary income (up from €141 billion to €157 billion). These developments were only partly offset by a larger surplus for primary income (up from €82 billion to €112 billion).

In direct investment, euro area residents made net disinvestments of €227 billion in non-euro area assets in the 12-month period to February 2019, compared with net investments of €180 billion in the 12 months to February 2018 (see Chart 2 and Table 2). Non-residents also made net disinvestments in the euro area of €234 billion, following net investments of €190 billion in the 12-month period to February 2018.

In portfolio investment, net acquisitions of foreign debt securities by euro area residents decreased to €81 billion in the 12-month period to February 2019, down from €466 billion in the 12 months to February 2018. Over the same period, a shift was observed in the investment activity of euro area residents in foreign equity, with net purchases of €226 billion in the 12-month period to February 2018 being followed by net sales of €22 billion in the 12 months to February 2019. Non-residents’ net purchases of euro area equity fell to €59 billion in the 12 months to February 2019, down from €431 billion in the 12 months to February 2018. At the same time, their net sales of euro area debt securities increased from €83 billion in the 12-month period to February 2018 to €124 billion in the 12 months to February 2019.

In other investment, euro area residents’ net acquisitions of foreign assets decreased to €141 billion in the 12 months to February 2019 (compared with €175 billion in the 12 months to February 2018), and their net incurrence of liabilities decreased to €96 billion, down from €208 billion in the 12 months to February 2018.

The monetary presentation of the balance of payments (see Chart 3) shows that euro area MFIs made net purchases of external assets of €150 billion in the 12-month period to February 2019. This increase was driven mainly by the euro area’s current and capital accounts surplus and, to a lesser extent, by non‑MFIs’ net inflows in portfolio investment equity. This was partly offset by euro area non-MFIs’ net outflows in portfolio investment debt securities.

In February 2019 the Eurosystem’s stock of reserve assets increased to €732.9 billion, up from €728.4 billion in the previous month (see Table 3). This increase of €4.5 billion was driven mainly by positive price changes (€3.2 billion) and, to a lesser extent, exchange rate changes (€1.0 billion) and net acquisitions of assets (€0.8 billion).